Domestic or International? Here’s 8 Ways An Overseas Trips Might Save You Money
As domestic traveling becomes more expensive, this might be a good time to book your international trip.
Traveling in the United States has always been more expensive than in Europe due to longer distances, higher labor costs, and airfare.
The COVID-19 pandemic, with its high demand for goods, the disruption in the supply chain, and subsequent inflation, has exacerbated the prices, making domestic travel a luxury for many Americans.
As the demand for post-pandemic travel has skyrocketed, prices for hotels, airfare, and activities have gone up too. While inflation has been slowing down, the cost of travel remains high in the United States making it an expensive country to explore.
Of course, it’s not only inflation’s fault as some major metro areas like Los Angeles, New York, Boston, and Honolulu, are known for their high living costs, which is also reflected in prices in the tourism sector.
New York City, one of the most expensive places to live, stands out in this category, so don’t expect to find bargains if you travel to the Big Apple.
Still, there’s a silver lining in the current high cost of living in the United States. While you will most certainly pay more for necessities in the United States, you will enjoy a nice financial advantage in other countries where the cost of goods and services is lower than at home.
Keep reading to find out why traveling to another country will likely cost less than a domestic trip within the US.
1. Eating Out
In 2022, United States inflation reached a staggering 9 percent. This is the highest in a generation, making many Americans dip into their savings and cut back on nonessential expenses.
While inflation has tampered down, going to bars, restaurants, and other dining venues has become expensive, with many Americans swapping restaurant meals for food from grocery stores. Experts point to a drop in consumer restaurant spending, with some opting for cheaper restaurants and others skipping eating out altogether.
As an American visiting a country with a lower cost of living, you have an indisputable benefit of higher power purchase. If you can afford higher restaurant bills in the United States, paying for food in less expensive countries should feel like a breeze.
You also can’t ignore the fact that you’re missing out on incredible international cuisines when you choose to travel domestically. Although you can find restaurants serving international cuisines in many American cities, trying the real deal is always the best idea.
2. Hotels
Hotel rates in the U.S. have risen by 20 percent since 2019. Expect to pay no less than $100 for the most basic hotel, and double or triple that amount, if you’re visiting a popular destination in the country.
If you travel, you likely already know that lodging costs have increased in the United States, and now you need to apply extra effort to get a good deal and avoid high rates. Lodging in Eastern Europe, South America, and some Asian countries often costs a fraction of what you would pay in the United States.
It’s possible to find a better variety of budget stays like hostels and guest houses on platforms like Agoda and HostelWorld. Hostels aren’t as common in the United States, outside of select coastal cities, and even basic stays like Motel 6 often have a much lower quality than an equivalent low-budget hotel in Europe.
If you want to ski in Lake Tahoe in the middle of winter, or see the incredible fall foliage in New Hampshire’s White Mountains during the peak season, be ready to pay a pretty penny.
On my recent trip to New England during the leaf-peeping seasons, accommodations averaged about $200, so if you want to enjoy a popular seasonal activity, don’t expect any bargains.
3. Public Transportation
Outside of a handful of cities like New York, San Francisco, Washington, D.C., and Boston, the United States lacks good public transport. This means renting a car is often required, especially if you want to visit national parks and other natural landmarks.
Most European countries have fairly developed public transportation, so you don’t have to worry when you want to go out and explore. On the downside, not all countries have cheap public transport. Switzerland, for example, has one of the most expensive public transportation networks in Europe.
While their trains are always timely and fast, don’t expect them to be cheap. If you plan to visit Switzerland or any other country where public transportation is expensive, check local passes and see if you qualify for discounts.
4. Airfare
Airline tickets have, by far, outpaced inflation with an average 25 percent increase, according to a consumer price index. The big jump is making many Americans reconsider their travel plans.
Of course, ticket prices in the United States vary considerably depending on the airport and time of the year, with Thanksgiving, Christmas, and Fourth of July being the most expensive times for flying. And if you know how to shop for tickets and use bonus points, you can score some decent deals.
Still, some things you can’t compare. In Europe, budget carriers like RyanAir offer one-way tickets as low as $17-$20 for some routes. However, let’s admit you don’t see these prices in the United States.
Of course, this price doesn’t include check-in luggage and only covers your seat and a carry-on item. An airline also tries to upsell you everything else, the same tactic that airlines like Frontier and Spirit deploy in the United States.
High airfare prices in the United States are influenced by long flying distances, the cost of jet fuel, and individual airline prices. Small airports in America are notoriously expensive to fly out of, and regional flights often cost hundreds of dollars.
5. Activities
Activities like guided tours, shows, and amusement parks can quickly burn through your budget, especially in a major city or national park in the United States. But, they’re usually cheaper elsewhere because they are often adjusted to the general cost of living in a specific country.
For instance, you can enjoy lower-cost or even free city tours in many European cities or even Mexico, where local guides offer city tours free of charge. Hop-on, hop-off buses are also usually relatively inexpensive compared to the U.S.
6. Groceries
The cost of basic groceries has increased steadily in the United States over the last few years. According to data from the U.S. Bureau of Labor Statistics, the average price of food increased by 2.3 percent from September 2023 through September 2024, after it grew by 2.1 percent in August.
Although no country has been immune to inflation in the post-pandemic world, the US has a higher average cost of living than many other nations, which translates to higher prices for many items, including groceries.
Basic food items are often cheaper in many Latin American and some European countries. While you don’t get much value when you spend your dollars in American grocery stores, your dollar usually goes much further in other countries, where you can get equal or higher quality food compared to the states.
7. Car Rentals
Renting a car in a foreign country could be a catch-22. While the rental price is not always high, gas prices sometimes are. This is especially true for Europe where many countries have higher gas prices than the United States.
Although prices at the pump tend to fluctuate based on geopolitical events, seasons, and other factors. Gas prices in the U.S. are usually cheaper than in most countries.
According to Global Petrol Prices, an industry-wide fuel price tracker, America has the 40th least expensive gasoline out of 170 countries analyzed. Prices per gallon in the United States are lower than in many nations including the U.K., Germany, Switzerland, and France.
Rental car companies in the United States often offer promos and special deals to lure customers, and you can also book rental cars with your credit card points, just like you can do with hotels and airline tickets.
One of the biggest draws of renting a car overseas is the opportunity to drive in a new place and test your driving skills. Renting a car in Europe, for example, could be a fun adventure depending on where you’re going, because it gives you a chance to get away from tourist spots and explore more authentic areas.
8. Service
The cost of service has also gotten more expensive in America. One example is hair salons.
You probably noticed many places asking if you want to add a tip to your bill, even if no actual service was provided. Asking for tips has become a standard practice in many places from restaurants to dry cleaners, barber shops, and hair salons. Some say the tipping culture in America is getting out of hand.
The concept of tipping is unique to the United States, where gratuities offset lower wages. In some European countries, service workers make a salary, and tipping is less commonplace. While in others, like Japan, tipping can be seen as offensive.
